The Japanese yen remained near the brink of the 160 mark against the US dollar, despite reports that Japanese Prime Minister Shigeru Ishiba's administration supports interest rate hikes. The Bloomberg Dollar Index slipped slightly on Thursday, as moderate producer price data led traders to scale back expectations for further Federal Reserve rate increases this year.

The Bloomberg Dollar Spot Index fell less than 0.1%.

According to data released Thursday by the US Bureau of Labor Statistics, the producer price index rose 4.7% year-over-year in July, down from a 5.5% increase in June. On a month-over-month basis, July's PPI was flat.

"We may have seen the worst of inflation data, but inflation remains well above target levels, and it's not time to pop the champagne," said Win Thin, chief economist at Bank of Nassau 1982. "The Fed may breathe a sigh of relief that the market is unlikely to force a rate hike in September, but Chair Powell still needs to explain how he plans to bring inflation back down to 2%."

The US government's 30-year bond auction yielded the highest level in 25 years, indicating that investors are demanding greater compensation amid growing fiscal deficits.

USD/JPY rose 0.1% at one point to 159.56 yen.

"Despite joint US-Japan intervention in the foreign exchange market, we expect the yen to only strengthen under its own market forces by next year," RBC Capital Markets strategists, including Elsa Lignos, wrote in a note. "This process could accelerate if the Bank of Japan turns hawkish or if Japan's Government Pension Investment Fund begins repatriating funds."

NZD/USD fell 0.1% to 0.5850.

AUD/USD was little changed at 0.7060.

According to the text of a speech delivered Thursday, Reserve Bank of Australia Assistant Governor Chris Kent stated that the central bank views the overall financial environment as still somewhat restrictive.

GBP/USD fell 0.1% to 1.3486.

EUR/USD was largely flat at $1.1531.